Workers on the average national wage will save more than 20% of their disposable income to their auto-enrolment pension by 2019 as contribution rates increase sharply in the coming years, research has found.
F&TRC said additional tools were needed to help average earners budget for the impending contribution increases. The first increase, from 1% to 3% of qualifying earnings is due to come into force in April. A subsequent rise, from 3% to 5%, is set for April 2019. F&TRC said while the savings policy had proved a great success - with more than nine million people saving into a workplace pension - the contribition rises would have a "severe impact on consumer's disposable income". The firm's Making Savings Affordable report said the contribition increase would result in employees having ...
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